Education sentences to ponder

The unemployment rate for young college graduates exceeds that of the general population, and about 41 percent of recent college graduates — and 33.8 percent of all college graduates — are underemployed in that they are working in jobs that don’t require a college degree, according to new data from the Federal Reserve Bank of New York.

Here is more from Elizabeth Redden.  The sad thing is, this is evidence of meritocracy, not a stinking economy.

Comments

...of a child entering high school this fall, this kind of factoid is scary AF

Look, I know it's stupid of me to engage with a troll, but I do have one burning question: Who is going to pay for all these goodies?

The baccalaureate unemployment rate is high. They are crowded out by English Lit PhD's as McDonalds cashiers.

Actually, the baccalaureate unemployment rate is at historic low levels. And McDonald's and most others are begging for help at every position.

there's liars, damned liars, and statisticians. What proportion of these "positions" offer health and retirement benefits, and guarantee a minimum number of hours, at least 25, per week? Yeah, I thought so.

Is it really true that Mike is paying you $2500 per month?

If your high school kids are willing to take advice, point them to the "outcomes by major" chart in Tyler's link. To avoid underemployment, the best majors are nursing, education and engineering. The worst: criminal justice, performing arts and hospitality. Sorry, Tyler, economics is middle of the pack.

Economics is not to get a skill to find a specific job. It is what you want to understand the world around you. It is the equivalent of the liberal studies of 100 years ago. Apart from very few jobs in academy, in Wall Street or as a parasite in some statist institutions, it does not have many obvious job descriptions to match it.

But I feel it is so beautiful and important for the development of a person living as a free and responsible individual that I am spending 2-3 hours a week to introduce my two pre-teen kids to it.

Massimo - I completely agree. I graduated college with a BS in Economics and a minor in Political Science 35 years ago and went directly into the Air Force as a commissioned officer. I retired after 23 years and went to work as a defense contractor.
I've never directly used my degree in economics as a requirement for any position I've held, , but feel the broad knowledge I learned from my studies of economics prepared me far better for the world than any STEM degree with a narrower, more defined field of study ever would have.
I wondered at the time what it would do for my future as a field of study, but now, looking at my life and the knowledge it brought me, I'd never trade my Econ degree for any other.

this is evidence of poor choice of a major.

Really? How's that? Please explain your cryptic comment. Because I used my education to wear a flight suit instead of a suit and tie?
My Econ degree taught me both hard and soft sciences, critical/comparative thinking and exposed me to concepts of a world economy far outreaching the small town I grew up in.
The foundation of my education allowed me to explore many other educational opportunities throughout my life.
Sorry Saul - hardly a poor choice of a major.

He actually did something useful.

lol, economics doesn't teach you science. it is a fake science like all the social science. you were indoctrinated with ideology. sorry but thats the truth.

Well pieshop... I certainly remember the chemistry and physics I took for electives being hard science. And I'm fairly certain the required calculus and several statistic classes I took weren't ideology.
I'm pretty sure I received a real education.
But thanks for your short sighted comment. Now. Go back to your moms basement.

Did the economics courses add much value beyond the mathematics courses?

Rick this is a thread of comments. My comment addressed the subject not your comment.

The unemployment rates are uniformly low. The so-called underemployment rate provides more differentiae. The underemployment rates are high, though not uniformly. There are surprises, too. Engineers underemployed? Wow.

Lots of college-as-signalling, more than I expected.

The US sadly has a culture of pushing BS degrees on students as the only way to amount to anything in life. That can easily lead to disappointment. There plenty of people who are not served well by that type of education. There are plenty of jobs that pay highly without the need of a degree. Add on the debt and the servitude that comes with it, I believe parents should encourage their kids to broaden their scope and not to be cowed into society's definition of "success" when really it's all about happiness. And yeah, I've got a high schooler, too.

The good thing about capitalism/democracy/general freedom is that when something stretches too far and bumps up against limits, eventually the 'system' finds workarounds. In other words, if something cannot go on forever it will eventually stop.

I believe this is starting to happen, with some very smart and successful people speaking and writing about how higher education needs to change, how college is not always the right call. I believe we will see more people comfortable with trades that pay well but don't require college, and online certifications instead of expensive 4 year degrees.

You can live and travel the world for free, and learn post-organic farming methods and business models, through one easy to use website these days. In a post Henry Miller world, I would give anything to be 18 years old again and completely drop out of the dystopia, and live life to its fullest in the dirt with a bunch of neo-hippies learning real survival skills.

This is not evidence of a meritocracy; it is evidence of college-as-signalling. Bryan Caplan would not be surprised by these data.

+1

As the percentage of degree holders rises, the signal is weakened.

As usual, W. S. Gilbert got there first: "When everyone is somebodee/ Then no one's anybody."

That's almost Yogi Berra-esque

Here's the problem with that:

If this were either a meritocracy or signalling effect, why would there be "problem majors" with mismatched supply and demand?

he field whose recent graduates have the highest rate of unemployment is mass media (7.8 percent), while the field whose recent graduates have the highest rate of underemployment is criminal justice (73.2 percent).

And in fact, if you click through to this page, you see that the vast majority of majors are pretty good, with unemployment numbers clustering much closer to zero.

Frankly I don't see how anyone can hold to a "general" opinion when there is so much variability by major. It has to be the real story.

Yeah, the low unemployment numbers just mean labor market is working, given all kinds 'a garbage. The high and variable underemployment numbers are consistent with college-as-signal.

yeah, but atlas shrugged.

Why would the signaling effect of a physics degree be the same as Media?

You’re once again attacking a strawman. No one ever claimed the signal was equal across institutions and majors.

Obviously.

Then maybe it is just a semantic theory then, recapitulating "nurses have skills" to be "nurses have signal."

Unless what, you can show a major that has no skill acquisition and no value in the marketplace and yet has magic "signal?"

(Under Tyler's theory, are nurses especially "meritorious" because they went into nursing? Does that theory hold better explanatory power than "nurses are in demand?")

You’re the Don Quixote of tilting at strawmen. You can’t literally be this obtuse though.

There are human capital effects from some degrees, sure, but the signaling effect dominates. And it’s not close.

Does a nurse who drops out a day before graduation make 0.06% less than a nurse who finished her degree?

Why not? If it’s human capital then it accumulates over time. If it’s signaling then the degree conferred is what matters.

It’s a step function, not a linear function.

Dude you can’t be this bad at math. Unless your degree is just signaling...

"If it’s signaling then the degree conferred is what matters."

What exactly do you think the nursing student who stick around one additional day is signalling?

What exactly do you think the nursing student who stick around one additional day is signalling?

That they could pass their exams and complete their courses.

“Does a nurse who drops out a day before graduation make 0.06% less than a nurse who finished her degree?“

Nursing is something of a special case here. In my state until recently a person could become an R.N. without a BS. Thus, yes, a student who had already completed her nursing certificate could drop out of the BS program and still get a nursing job. No more. The state now requires the BS degree for RN certification. To the extent that this is a nationwide trend, it will somewhat skew the early- vs. -mid-career comparisons. In my opinion, the BS requirement is more signaling than the certification program, which focuses on vocational training.

My RN wife corrects me: the state still grants RN licenses from certificate programs. But the Dept. of Health is pressuring hospitals to achieve 80% BS degrees among their nursing staffs. Her employer requires new RNs to achieve the BS within three years of hire. Many do this via online programs.

That would tend to indicate a high signalling ratio even for nursing degrees. Do the nurses who get the degree suddenly become much more skilled? Are they noticeably better nurses than ones without the degree but with 4 year's more experience?

They ain't.

The underemployment rate is high in everything [to my surprise], but it does vary across disciplines. It's 56% in Sociology, but only 32% in Physics. In a field like Nursing, where you gotta do stuff in such wise as to avoid killing the customer, it's only 11%.

The weirdo, as someone pointed out below, is Education. But as I said there, the field has no standards, EXCEPT having the degree.

Note the "general education," is not a teaching related degree.

https://learn.org/articles/What_is_a_General_Education_Degree.html

They go into HR? Well, just about every company has HR which hires HR. It is a practical choice.

Dude you’re making his argument stronger and stronger....

Good lord, man. Learn to quit while you’re debunked but not outed as a clueless idiot.

Or, you guys are just going on about signaling being anything and everything.

Nurses can do nursing so that's signaling. Petroleum engineers can do petroleum engineering so that's signaling. People with general education can go into HR so that's signaling.

Except you never did explain why the bad majors can't do that.

You end up with a just so argument that the bad majors must be bad signaling, rather than they learn the wrong skills.

Both nurses and petroleum engineering graduates have arrangements where they are actually trained on the job. The degree gets them in the door. The degree shows they have the ability to learn how to do it.

Some situations the degree includes the on the job training.

People who recently finished a non-job way of life have higher non-job rates than people who didn't recently finish a non-job way of life. And jobs that don't require degrees =/= will never benefit from having attained a degree, unless you think high schools are crazy hot.

That explains the 41% but the interesting statistic is the 33.8%.

I would have guessed 50%.

100% of jobs don't "need" conscientiousness, yet it makes 100% of jobs better

Yes, comparing unemployment rates of recent graduates with the general public is silly or maybe even beyond silly. Young people who are trying to find their niche professionally, personally and geographically will rationally invest a lot in search and move around a lot.

I'm curious how the statistics of "needing a college degree" are generated. Many jobs that require a degree to apply have no component that actually requires skills or training acquired while getting a bachelors degree. The bachelors degree serves to signal a degree of intelligence and achievement.

The biggest problem with non-professional undergraduate education in the US is the enormous amount of valuable time and money spent by 18-22 year-olds acquiring degrees that convey few if any marketable skills. Surely we can create signalling methods to differentiate individuals to potential employers that require less of an investment in time and money. Perhaps we could also teach some marketable skills, but lets not be too ambitious.

Alas, so far all such attempts have run up against "disparate impact". Whites and Asians are "over-represented" among those signal well. That is illegal and socially infra dig, so there is little incentive to push development of alternative signalling methods further. Easier just to use college degrees, where no one cares about the tremendous disparate impact.

Oh, and on language, to avoid false conciousness: These college graduates are not underemployed; they are over [pseudo] educated.

Over- or mis- ...

Here's a little nugget from the link above. "General Education" majors have a 1.7% unemployment rate, and a 22.2% underemployment rate. But the average of all majors is roughly double that, at 3.9% and 42.9% respectively.

How does a "meritocracy" or "signalling" theory possibly explain that (without pretzel logic, that is)?

Do you think General Education is an especially tough major?

No, the opposite! Does the industry into which Gen Ed'ers aspire entry have any standards of any kind? :-)

I think this is contorted thinking, which is kind of bizarre.

I am proposing a simple model of supply and demand. Some majors are in demand, and some are not. As the guy at the second link says, guiding students into high demand studies improves outcome.

"Economists" say "oh no, the answer must be ideological!"

And how does the demander know the supplier can supply? :-)

A GPA in a major matching the work, usually.

Petroleum engineers go to oil fields, etc.

I refuse to believe you are this stupid.

What’s the demand for a petroleum engineer who is self taught but can pass all certification tests?

What’s the demand for a petroleum engineer who passed all of his petroleum engineering related classes but was denied a degree because he never finished his literature requirement?

What’s the demand for a petroleum engineer who dropped out a day before his graduation?

This is 2nd grade logic tests dude.

You’re a Boomer. Time to grow up.

It seems obvious to me, and the fact that you have to go to these weird corner cases proves it.

The petroleum engineer develops skills, and the degree in petroleum engineering was a certification of those skills.

It wasn't just signaling, it was applied education, and that's why not just anyone with a college degree and a high GPA can go down and do petroleum engineering.

The weird corner cases are also very unlikely to happen, and are a form of signaling in themselves. The one who drops out a day early is going to shrink from challenges on the job too. The one who doesn't complete the literature requirement will be a lousy boss someday because he won't have any general knowledge and will only be good at an entry level engineering position that doesn't use much general knowledge.

And that, precisely, is signalling! :-)

Bryan Caplan, Mr. The Case Against Education, is very clear that a college degree signals more than just intelligence. It signals intelligence, conscientiousness, and the willingness and ability to "play the game"--to figure out what is required and to do it.

Most jobs use very little of the subject matter knowledge and skills that college courses purport to impart. Yes, even nurses and petroleum engineers leave most of their academic knowledge behind and do an awful lot of on-the-job learning. But the degree does signal that they will be able to do this better than someone from a different degree program.

I would have thought that, too. But engineers are also underemployed to a non-trivial extent.

If you tap the second column it sorts on under employment.

Engineers occupy pretty much the least under employed territory.

Cowen is trolling. I'll play along. Cowen: "The sad thing is, this is evidence of meritocracy, not a stinking economy." Why does a degree from GMU rank so low on value ratings for college degrees? Is it due to the lack of meritocracy of the students or the faculty? Why would Cowen work at GMU if there's no meritocracy there?

Speaking with Charly Popper, attack hypotheses, not people.

% of college graduate unemployment rate is a pretty useless stat.
The unemployment rate stat for degree type is a useful statistic.

There's a link in the article.

https://www.newyorkfed.org/research/college-labor-market/college-labor-market_compare-majors.html

good time to be in early childhood education!

Whats the unemployment rate for MRUniversity graduates?

^^^ Best troll comment of the thread so far.

Why is someone 'underemployed' if they aren't working in their chosen degree field? If everyone at once decided to get a degree in Art History and had to work in other jobs, they wouldn't be "underemployed", they just wouldn't understand the basic economics of supply and demand. Just because you chose to follow a degree path that has no jobs doesn't make you underemployed, it makes you at the very least naive to life's realities.

Or maybe you're killing time. For some highly competitive fields, there may not be an immediate opening--but one may occur in 5 years. What do you do during that time? Sit at home watching TV? Or find gainful employment, even if it's outside your field? If you have an ounce of self-respect, you get a job! That's not under-employment, it's making a rational choice.

"If everyone at once decided to get a degree in Art History and had to work in other jobs..." 99% of them would be overemployed.

Unfortunately, not everyone can be filthy rich, and it seems like everyone is trying to compete to be upper middle class. By definition, most of them have to fail.

Stop focusing on helping everyone earn above average incomes and start focusing on what people with below average incomes can afford. It's more like if everyone had an upper midle class income we would all be able to afford homes in coastal california. Not if they don't let people build more homes in coastal california.

Being upper middle class is not a positional good. Under some set of circumstances, such as abundant opportunity and no stupid people, everyone can be upper middle class.

Not everyone can live in coastal California because that is a positional good. There is a relatively fixed number of places to live in coastal California and that is not going to change.

This is a good comment, but there's a factor you haven't expressly stated, so I'll do that:

Often what determines whether a person is upper-middle class or something lower is not their incomes, but rather their choice of location, housing arrangement, savings rate, etc.

Hazel is right that there is never going to be a situation in which everyone is upper-middle class, but Larry is more correct about why. We all choose to save differently, to live in different places, and so on. We're not competing for space within the upper classes, we're trading a position in a higher class for weird luxury goods like "living in a high-rise downtown" or "being within walking distance to the local bike path."

I think if people in San Fran had more firsthand knowledge of how high their quality of life would be in, say, Little Rock, they probably wouldn't live in SF anymore. But then again, some people will spend a lot of money to feel hip, even if it means giving up a higher class or quality of life.

+1, Hazel's correct, upper middle class is very much a positional good. By definition, it's having an above average income (though some dictionaries use the term status).

FTA: The December 2019 unemployment rate for individuals aged 22 to 27 with a bachelor’s degree or higher was, at 3.9 percent, slightly higher than the 3.6 percent unemployment rate for all workers between the ages of 16 and 65. However, it was lower than the 6.5 percent unemployment rate for 22- to 27-year-olds without a four-year degree.

Note that last sentence. It's still better to go to college for, at least, the signaling effects.

Why is this evidence of meritocracy? The big issue I see in the graph is that young people regardless of education have far higher unemployment than the general population. Is this meritocracy, or an excessive focus on seniority? Similarly, while young college graduates’ unemployment rate has ticked up, the overall unemployment rate for all college graduates is far lower and remains low. If employers were putting less value on the signaling of a college degree as the meritocracy story suggests, the unemployment rate for non-recent graduates should be ticking up too. All this merely suggests that on the margin some employers are replacing one form of credentialism (college degree) for another (seniority and experience). And just as the former form of credentialism was arguably a factor in the rise of Trump, the latter form of credentialism appears to be a very significant factor in the rise of Sanders among the young.

The problem is three fold: (1) the atrophy of secondary education and (2) the padding of tertiary education and (3) reliance on tertiary schooling to sort the labor force and the evaporation of occupational testing. A restoration of testing as well as briefer, more focused, and more vocationally-oriented secondary and tertiary programs might improve matters. Some restructuring in the finance of tertiary schooling - more socialized costs but more rationing - would also be in order.

+5 internet points, good ideas

20th Century American culture was all about improving your station in life & enabling your kids to expand on that. The transition from sustenance agricultural to an industrial economy made the first steps fairly simple. Education was the key tool in advancing further, first graduating high school. College was the next step, but in those days a BA in liberal arts made you an attractive hire to almost any employer. Specialization & technological advances have changed the dynamic again. This was occurring even as the silly idea that everyone should go to college even if they had to borrow to get there took hold. We're left with degreed job seekers underqualified for the best paying jobs & overqualified for most others, leaving them paying off useless degrees.

Institutions should have some skin in that game, lenders, too, but not innocent taxpayers

"Institutions should have some skin in that game, lenders, too ..."

That would help, a lot.

The unemployment point is misleading.

"The December 2019 unemployment rate for individuals aged 22 to 27 with a bachelor’s degree or higher was, at 3.9 percent, slightly higher than the 3.6 percent unemployment rate for all workers between the ages of 16 and 65. However, it was lower than the 6.5 percent unemployment rate for 22- to 27-year-olds without a four-year degree. The unemployment rate for all college graduates up to age 65 was 2.2 percent."

There are also lots of jobs (from journalist to business owner to organized crime boss) in which having a college degree leads to more success, even though it isn't a job requirement. Not working at a job that only a college graduate can perform doesn't mean you are underemployed.

"under-employment" is simply a job that doesn't require a college credential. Many college graduates are working fully at the utility of their college major/degree.

Way back in 1979, when I was applying to college and choosing a major, the news was filled with the stories of Ph.Ds in Astrophysics washing dishes because the astrophysics jobs had dried up with the cutbacks in the Space Program. Even then, entering college in 1980, I knew I need a hard science or engineering degree. The Liberal Arts weren't a good bet. My brother got one of those in the mid-1970s (history) and was a carpenter. Was he under-employed or did he err in not getting a PhD in hopes his history degree have direct relation to his employment?

Under-employment is as much a comment on the quality of graduates as it is anything.

This is an area where free marketers get a bit sketchy, but what if a society should run a big space program at a loss? Or for that matter field a huge number of social workers?

It dramatically changes the employability of those majors.

" but what if a society should run a big space program at a loss? "

We do run a big space program at a loss? When was the last year that NASA turned a profit?

Or our you saying that we should increase NASA so that it's big enough that everybody who decides to graduate with a Astrophysics degree automatically has a job?

Is this part of the Sander's national job guarantee program?

vowel noun!!!!!!

Now, who would have thunk it?

https://www.amazon.com/gp/product/1467978302/

Unemployment rate for journalism majors: 3.7%
Unemployment rate for computer science majors: 4.7%

Instead of learning to code, people need to learn to write. #LearnToWrite

Suppose X percentage of the journalism graduates are competent and Y percentage of the computer science graduates are competent . If X equals Y then the two numbers you cite are comparable. If not then the numbers are not comparable. Graduation doesn't really indicate as much as a person might assume.

"jobs that don’t require a college degree"
Many jobs once didn't require a college degree. The only criteria for "requiring" a college degree in some entity, either the employer or a regulator, determines that it is required. I suppose it would be more accurate to say "don't officially require a college degree."

To get in before Sailer. There is about 2 million bachelors degrees each year. Through all channels there is probably about 1 million immigrants with a college degree each year (H1b, OPT, and all the others.) 50% increase in labor supply will have some effect. (Could also argue its amazing the unemployment is not higher.)

I find the comments like "they say everyone should get a college degree" to be strawman's arguments. I don't know of a single person who says everyone should get a college degree. Do you?

1. I retired about a year ago from a social science dept in a large state University. SInce retiring, I have run into two or three former students who were working in retail. This does seem to be "under employment".
2. Over a decade ago, my child graduated with a degree in English and had 4 or 5 white-collar job offers -- largely because of the child's ability to write clearly and edit other writing to eliminate grammar and spelling mistakes.
3. Anticipating some feedback -- certainly a well trained high school graduate should be able to write clearly and edit mistakes. But I think high schools no longer train for this job skill. (But this supports the view that there is evidence of meritocracy, since if what you want is clear writing and editing, and if you can identify high school grads who have that skill, why hire a college grad?)
4. What I observed in my career at the university level is that there was a weakening of training in analytical thinking. There was more and more reward for writing a paper that had a superficially convincing argument in favor of a politically popular point of view, compared to writing a paper that attacked the status-quo thinking with logic and data.

>The sad thing is, this is evidence of meritocracy, not a stinking economy.

I know.... if only there were a stinking economy! Your Dems might possibly win in 2020!!

Funny, I said the same thing, and Tyler deleted it.

This happened twice.

Surprised no one took the other side of TC's argument: this is a stinking economy! If your modern, rich, high-tech economy can't find work to make full use of their abilities then the economy is clearly broken. It's not like there's a limit to innovation. For example, why isn't there a 5G company (like an American Huawei) or a consumer drone company (like an American DJI) in the US? All those underemployed engineers could be put to good use to make it happen! To call this broken state of affairs a meritocracy is just outright complacency and cheerleading our stagnation instead of challenging it.

Will college exist, in it's current form in 10 years? 20?

This isn't surprising. There are a growing number of majors (not just the humanities anymore) for which the only real career path "in your field" is to go get an advanced degree and work in research/academia/teaching in that field. If you don't manage that, you are going to end up "underemployed". Unless you went to a truly elite institution, in which case Booz Allen Hamilton or whoever will hire you even if you graduated with a 2.9 in rococo studies.

And/or it implies a signalling competition?

>The sad thing is, this is evidence of meritocracy, not a stinking economy.

Poor Tyler... hoping for a stinking economy to save him in November 2020, but eternally disappointed!

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